Nigeria has experienced a significant decline in monthly oil production since January 2024, resulting in a staggering revenue loss of approximately N636.3 billion, according to Sunday PUNCH’s investigation.
In January, Nigeria produced 1.43 million barrels of crude oil (excluding condensates), but by May, this figure plummeted to 1.25 million barrels per day (mbpd).
The Nigerian Upstream Petroleum Regulatory Commission reported a total crude production volume of 44.22 million barrels in January, which decreased to 38.8 million barrels in May—a drop of 5.43 million barrels during this period.
The average Brent crude oil price rose marginally from $80.12 per barrel in January to $81.75 in May, as per data from Statistica. Meanwhile, the naira struggled against the dollar, with an exchange rate of 1,434.1 naira per dollar in May.
Based on these factors, Nigeria suffered an estimated revenue loss of N636.3 billion between January and May this year.
The persistent decline in oil production has been attributed to pipeline vandalism and crude oil theft. Despite government efforts to address the issue, success remains elusive.
Recently, on June 13, 2024, the Nigerian National Petroleum Company Limited called for a special court to prosecute oil theft and pipeline vandalism culprits. NNPC’s Group Chief Executive Officer, Mele Kyari, emphasized the need for swift judicial action to combat these challenges and unlock the oil and gas industry’s full potential.
Major oil companies have also expressed concern about the impact of theft and vandalism on crude availability for local refineries. Dr. Chinyere Almona, Director-General of the Lagos State Chamber of Commerce and Industry, highlighted the difficulties faced by modular refineries in securing sufficient crude.
Additionally, low crude oil production in Nigeria has limited international oil companies’ ability to supply the Dangote Petroleum Refinery and other modular refineries.
